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| 1 | |
Which of the following statements about self-regulation by trade associations is true? |
| | A) | Many trade and industry associations have developed their own advertising guidelines that member companies are expected to abide by. |
| | B) | Self-regulation is commonplace in industries where advertising is prone to controversy. |
| | C) | Many professions maintain advertising guidelines through local, state, and national organizations. |
| | D) | For years, professional organizations restricted advertising by their members on the basis that such promotional claims lowered members' professional status. |
| | E) | All of the above statements about self-regulation by trade associations are true. |
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| 2 | |
A number of self-regulatory mechanisms have been established by the business community to control advertising practices. The largest and best known is the: |
| | A) | Federal Trade Commission |
| | B) | Federal Communications Commission |
| | C) | Better Business Bureau |
| | D) | National Advertising Review Council |
| | E) | Chamber of Commerce |
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| 3 | |
The _____ is the major trade association of the ad agency business in the United States. |
| | A) | American Association of Advertising Agencies |
| | B) | National Advertising Review Council |
| | C) | American Advertising Federation |
| | D) | National Association of Attorney Generals |
| | E) | Association of American Agencies |
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| 4 | |
Which of the following statements about self-regulation by the network television media is true? |
| | A) | Commercials submitted for review must be in finished format. |
| | B) | Advertisers must submit all commercials intended for airing on the network or one of its affiliates. |
| | C) | The same standards are used to judge all commercials. |
| | D) | Network standards regarding acceptable advertising has not changed in the last 25 years. |
| | E) | All of the above statements about self-regulation by the television media are true. |
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| 5 | |
The Central Hudson Test: |
| | A) | was used to define unfair advertising prior to the passage of the Wheeler-Lea Amendment |
| | B) | is used to determine if a sales promotion can be characterized as a contest or if it must be called a sweepstakes |
| | C) | is used to justify restocking fees |
| | D) | is a four-part test used to determine restrictions on commercial speech |
| | E) | can be used to identify the need for corrective advertising |
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| 6 | |
The Wheeler-Lea Amendment was passed by the U.S. Congress to close a loophole in the: |
| | A) | Sherman Act |
| | B) | NAD/NARB Act |
| | C) | Robinson-Patman Act |
| | D) | Food and Drug Administration Act |
| | E) | Federal Trade Commission Act |
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| 7 | |
The Olive Garden restaurant chain uses the slogan, "When you're here, you're family," in all of its advertising. While this slogan is designed to show customers how welcomed they are at the Olive Garden restaurants, it is not intended to be taken literally. Since customers are not really members of the Olive Garden family, the ad slogan is an example of: |
| | A) | deceptive advertising |
| | B) | superiority advocacy |
| | C) | puffery |
| | D) | comparative advertising |
| | E) | noncompetitive advertising |
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| 8 | |
Have you ever seen ads for weight-loss programs that show before pictures of fat, unattractive people and after pictures of thin, attractive people. The ads generally state that someone who used the product lost some huge amount of weight in only six months. In small print in the ad, there is typically a statement that says this participant's results were not typical of the average user. Why is this statement in smaller print included? |
| | A) | to avoid puffery |
| | B) | as a form of correct advertising |
| | C) | to eliminate the need for competitors to use negative comparative advertising |
| | D) | to adhere to the FTC's requirements for affirmative disclosures |
| | E) | to do all of the above |
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| 9 | |
How has the FTC's substantiation program affected the advertising industry? |
| | A) | It shifted the burden of proof for ad claims from the commission to the advertiser. |
| | B) | It created an environment in which comparative advertising is legal and ethical. |
| | C) | It created a simple four-way test that can be used by agencies, advertisers, and media to determine if an ad is deceptive. |
| | D) | It encouraged professionals to engage in advertising. |
| | E) | It required the media to provide specific time and space allocations to public service announcements. |
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| 10 | |
Assume the FTC has determined that an advertiser's ad is deceptive. The FTC will then issue a _____ and may require _____. |
| | A) | commercial speech injunction; corrective advertising |
| | B) | consent order; competitive advertising |
| | C) | cease-and-desist order; corrective advertising |
| | D) | consent order; an advertising ban |
| | E) | trade regulation ruling; a cease-and-desist order |
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| 11 | |
The Federal Communications Commission (FCC): |
| | A) | no longer limits the amount of television time that can be devoted to commercials |
| | B) | does not work in conjunction with any other federal agency |
| | C) | only deals with broadcast and print media as they existed when the agency was developed |
| | D) | has control over advertising that is sent through the U.S. mail |
| | E) | has no control over the use of obscene and profane language in programming |
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| 12 | |
Marius has received an opportunity in the mail to receive $5 million if he will send $5,000 to the first name and address on a list that is enclosed with the mailing. Which federal regulatory agency would be most interested in examining this direct-mail advertising? |
| | A) | U.S. Postal Service |
| | B) | Federal Communications Commission |
| | C) | Bureau of Alcohol, Tobacco and Firearms |
| | D) | Food and Drug Administration |
| | E) | Better Business Bureau |
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| 13 | |
Which federal agency regulates the use of various types of trade allowances? |
| | A) | U.S. Postal Service |
| | B) | Federal Trade Commission |
| | C) | Bureau of Alcohol, Tobacco and Firearms |
| | D) | Food and Drug Administration |
| | E) | America Association of Advertising Agencies |
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